Millennium Post

Nitish asks PC to implement Rajan report

In a letter to union Finance Minister P Chidambaram, he said the proportional share between the Centre and the state in centrally sponsored schemes should be changed for the least developed states like the one existing for special category states now.

As per existing norms, special category states at present pay only 10 per cent share in the centrally sponsored schemes and the rest 90 per cent is borne by the Union government.

Also, the funds under the schemes do not lapse in the case of special category states.

Kumar also asked Chidambaram to allocate additional gross budgetary support to the Planning Commission for accommodating the financial requirement.

He also sought the evolution of a fiscal regime of tax breaks and concessions for incentivising private investments in the least developed states on the lines of the treatment currently given to special category states.

Kumar, who has made a strong case for according special category status for Bihar, said it should be done within next six weeks. He said though he had doubts on the choice of variables which should have been per capita income instead of per capita consumption and the weights assigned to them, he had welcomed the report.

He said it would have been more rational and appropriate if per capita income, per capita consumption of electricity and credit-deposit ratio had been included as variables while evolving a composite development index.
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